Million Aussies cut from hospital network

As more people drop their private health insurance and elective surgery wait times at public hospitals blow out beyond 109 days, a major row is threatening the health insurance of more than one millions Australians.

Talks between six members of the Australian Health Services Alliance (AHSA) and Healthscope – a for-profit Australian company that operates private hospitals, medical centres and international pathology services – have broken down. The talks for a new three-year contract started in November last year.

The result is that more than one million Australians will be unable to access treatment at 42 Healthscope private hospitals after 8 June without incurring out-of-pocket costs.

Emergency hospital admissions will continue until 7 September.

The AHSA is a non-profit that negotiates agreements with private hospitals on behalf of 27 small to medium-sized health funds. It is the third largest health insurance buying group after Bupa and Medibank, according to the Australian Financial Review.

The six affected AHSA members are: Australian Unity, Teachers Health Fund, CUA Health, Reserve Bank Health Society, CBHS Corporate Health and CBHS Health Fund.

Healthscope said an agreement could not be reached on the rate offered to it by the health funds.

“The decision not to recontract has been made with regard to the future commercial sustainability of our business as we must be appropriately reimbursed for the work our people do every day, and at a rate that allows us to be able to invest in our facilities and equipment so we can continue to deliver world-class care for patients,” a spokesperson said.

“This was not a decision we took lightly and is not our preferred option, but we are committed to securing arrangements with private health insurers that maintain the financial viability of private hospitals.”

Teachers Health Fund, a not-for-profit and member-owned insurer that represents more than 160,000 teachers and their families, says Healthscope’s decision to terminate the agreement is “irresponsible and unconscionable”. It claims Healthscope was being unreasonable by charging “additional fees” for industry-minimum standards that would have resulted in an unacceptable and unfair increase in costs for its members.

“This opportunistic and exploitative behaviour demonstrates the lack of competition faced by Healthscope and its ability to make take-it-or-leave-it offers to health funds,” Teachers Health Fund chief executive Brad Joyce said on Monday.

“It unfairly targets teachers who are already facing personal and professional challenges during COVID-19.

“Considering the current climate, supporting the physical and mental health needs of our teachers should not be used as a bargaining tool.”

Healthscope hospitals affected

Australian Capital Territory

National Capital Private Hospital

New South Wales

Campbelltown Private Hospital

Hunter Valley Private Hospital

Lady Davidson Private Hospital

Mosman Private Hospital

Nepean Private Hospital

Newcastle Private Hospital

Northern Beaches Hospital

Norwest Private Hospital

Prince of Wales Private Hospital

Sydney Southwest Private Hospital

The Hills Private Hospital

The Sydney Clinic

Tweed Day Surgery

Northern Territory

Darwin Private Hospital

Queensland

Brisbane Private Hospital

Gold Coast Private Hospital

Pacific Private Hospital

Peninsula Private Hospital

Pine Rivers Private Hospital

Sunnybank Private Hospital

South Australia

Ashford Hospital

Flinders Private Hospital

Griffith Rehabilitation Hospital

Parkwynd Private Hospital

The Memorial Hospital

Tasmania

Hobart Private Hospital

St Helen’s Private Hospital

Victoria

Bellbird Private Hospital

Dorset Rehabilitation Centre

Frankston Private Hospital

Holmesglen Private Hospital

John Fawkner Private Hospital

La Trobe Private Hospital

Knox Private Hospital

Melbourne Private Hospital

North Eastern Rehabilitation Centre

Northpark Private Hospital

Ringwood Private Hospital

The Geelong Clinic

The Melbourne Clinic

The Victoria Clinic

The Victorian Rehabilitation Centre

Western Australia

Mount Hospital

About 44 per cent of Australians have private hospital cover, according to the latest Australian Prudential Regulation Authority (APRA) data – a drop of 0.2 percentage points in the quarter compared to September 2019. The figure was pre-coronavirus.

Does this breakdown affect your private health insurance? Are you fearful that such a standoff will spread to other networks?

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Written by Janelle Ward

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